All Forum Posts by: Neil Aggarwal

Credit unions used to be limited-membership organizations.  For example, if you worked for a specific company, only then could you join their credit union.

Nowadays, they are looking more like banks.  Anyone can join. So, to me, there is no practical difference anymore.

You can have relationships with multiple banks and credit unions.  There is no exclusivity with either.

I suggest you talk to all the banks and credit unions around you to see what they offer.  Sometimes, you will find an organization that matches your needs better than the others.

Another option is to look for private money sources near you.  They are generally higher interest but some will qualify you based on the property, not on your debt or income. It may be hard to find something that matches your needs, but nothing worthwhile is ever easy. 

I have seen newbies think of such properties as worth the land value.  That is not true.  You have to pay someone to remove the building before you can do anything with the property.  Therefore, it is worth less than the land value.

County sqft numbers are off a lot of times.  The appraiser actually measured the house so I would use their numbers.

You have nothing to lose and something to gain by asking the seller to negotiate based on the appraiser's sqft.

You are trying to buy properties to rehab. You can't effectively rehab an occupied property so you will have to wait until the tenant moves out.  That will tie up your money for a while.  I am not sure buying rentals will be consistent with rehabbing.

If you can swing a hard money loan, do that.  Sometimes, partnerships end very badly.

I would use comps as much as possible to indicate what you should pay.  If the seller is looking for too high a number, walk away from it.

Remember, if you pay a premium when you buy it, you may not be able to get a similar premium when you need to sell it.

Hard money is great for rehab, but typically has a short term with points and fees if you need to renew.  If you are going to go that route, make sure you can get long-term financing once the property is rehabbed. If you can get a bank loan, that is a good solution.  If not, you may have to look into private money sources.

Private money may also be open to the seller carrying a second lien.  They are likely higher interest than a bank loan, but may be viable if need to keep your capital free for another deal.

Here is a definition of a portfolio lender:

Investopedia

To me, it does not matter if the lender keeps your loan or sells it off. You are still going to mail a check every month.

I assume the hard money loan is a short-term loan which is why you need to replace it. Therefore, you need a long-term loan, whether it be from a bank or private money.  It does not matter who gives you the loan, only that the terms are a good fit for your needs.